Closing the books on cable spat

Media giant writes FCC check for Disney/ABC cable flap

WASHINGTON — Preempting any official fine, AOL Time Warner has agreed to write a $72,000 check to the U.S. Treasury for dropping ABC channels from its cable systems during last year’s May sweeps, the FCC announced Friday.

In exchange for making the lump-sum payment, the Federal Communications Commission will close the books on the bitter spat between AOL Time Warner and Disney-owned ABC. No other enforcement action will be sought against AOL Time Warner, according to the FCC.

The regulatory agency had already concluded that AOL Time Warner –then just Time Warner — had violated FCC rules when dropping ABC channels in major markets such as Los Angeles and New York.

The ABC blackout affected more than 3 million cable customers for nearly 40 hours.

Time Warner said it took the drastic action after Disney insisted that TW cable systems carry additional Disney cable channels as a condition of carrying the ABC net.

Although Time Warner quickly restored carriage of ABC and other Disney channels, the feud spilled over into Time Warner’s merger with AOL.

Disney fought the merger tooth and nail, saying the union would further Time Warner’s monopolistic practices.

Mouse could not be reached for comment on AOL Time Warner’s monetary settlement.

FCC said the $72,000 payment was calculated at a rate of $750 for each of 96 cable systems.

In its order, the agency repeatedly commended AOL Time Warner for moving quickly to restore Disney channels, as well as for working with FCC officials to resolve the case.

“Time Warner cable has made a voluntary payment to the U.S. Treasury as part of the final resolution of the matter with the FCC, and we are pleased to have this matter from last May behind us,” an AOL Time Warner spokeswoman said.

(Reuters contributed to this report.)

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